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Ah yes, possibly the 5th company that I wished I joined this past 18 months... Historically there were some exchanges that have been hacked. This caused not o

Ah yes, possibly the 5th company that I wished I joined this past 18 months... Historically there were some exchanges that have been hacked. This caused not only the company to go bankrupt but people losing a lot of money. How does coinbase prevent this from happening? This is very much one of the reasons I will never hold crypto (FYI: I've wrote my own Golang flavour of ethereum blockchain and solidity when it first came out, since im gonna get bashed for this post. I also regret not putting 1k during ethereums ICO when that was the only money I had in my bank account. This is not an investment advice). If my etrade or bank account got hacked, I can still get my money back through FDIC and SIPC. If a non-tech personstarted hyping a cryptocurrency and placed 100k in it, and they get hacked, essentially their 100k evaporates right? I guess there are worse ways to gamble your money What I like about crypto though is the 24/7 market. I wish there was something like this in the stock market.

herpderperator 6y ago
TD Ameritrade's 24/5 is the closest we have to this at this time. The volume is quite limiting.
- kevindeasis 6y ago
  That's interesting, I googled this and I didn't know this existed. Thank you
tony101 6y ago
It's not perfect, but I believe Coinbase uses a combination of cold (offline) storage for most of its coins and insurance for the rest. Also, as you probably already know, people should not hold large sums on exchanges if they can use secure their own keys (and wallets) instead. > "Coinbase prioritizes the security of our customer's digital currency through a combination of online “hot storage” and offline “cold” storage. Coinbase maintains 98% or more of customer digital currency in cold storage, with the remainder in secure hot servers as necessary to serve the liquidity needs of our customers. All digital currency that Coinbase holds in its online hot storage is insured. If Coinbase were to suffer a breach of its online hot storage, the insurance policy would pay out to cover any customer funds lost as a result." https://help.coinbase.com/en/coinbase/other-topics/legal-policies/how-is-coinbase-insured https://help.coinbase.com/en/coinbase/other-topics/legal-pol...
- kevindeasis 6y ago
  Wow, that's a fun fact, there is an insurance. That's pretty cool, I wonder how much insurance are for these companies and brokerages
- fy20 6y ago
  I'd imagine with SV money and SV knowledge building a secure exchange, with proper cold wallets and processes in place to secure them and manage access, is not that difficult. I get the impression that a lot of exchanges are (or were in the early days) built by 'enthusiasts' who know just enough tech to be dangerous.
- tradertef 6y ago
  You are assuming cold storage can not be "hacked" or "stolen". It is much more difficult at Coinbase scale but such an event would have drastic impact on crypto markets. Coinbase is too big to fail :)
  - tony101 6y ago
    I'm not assuming that. I said "it's not perfect" and simply listed the security measures that I am aware of :)
hakeberio 6y ago
Regarding your last line: futures trade nearly 24 hours, 6 days/week. It's also several times bigger than the ETF market, in terms of average daily dollar volume, so you get the liquidity and smaller spreads as well. [1] [1]: https://www.cmegroup.com/education/courses/futures-vs-etfs/why-trade-futures-instead-of-etfs.html https://www.cmegroup.com/education/courses/futures-vs-etfs/w...

herpderperator 6y ago

TD Ameritrade's 24/5 is the closest we have to this at this time. The volume is quite limiting.

kevindeasis 6y ago
That's interesting, I googled this and I didn't know this existed. Thank you

tony101 6y ago

It's not perfect, but I believe Coinbase uses a combination of cold (offline) storage for most of its coins and insurance for the rest. Also, as you probably already know, people should not hold large sums on exchanges if they can use secure their own keys (and wallets) instead. > "Coinbase prioritizes the security of our customer's digital currency through a combination of online “hot storage” and offline “cold” storage. Coinbase maintains 98% or more of customer digital currency in cold storage, with the remainder in secure hot servers as necessary to serve the liquidity needs of our customers. All digital currency that Coinbase holds in its online hot storage is insured. If Coinbase were to suffer a breach of its online hot storage, the insurance policy would pay out to cover any customer funds lost as a result." https://help.coinbase.com/en/coinbase/other-topics/legal-policies/how-is-coinbase-insured https://help.coinbase.com/en/coinbase/other-topics/legal-pol...

kevindeasis 6y ago
Wow, that's a fun fact, there is an insurance. That's pretty cool, I wonder how much insurance are for these companies and brokerages
fy20 6y ago
I'd imagine with SV money and SV knowledge building a secure exchange, with proper cold wallets and processes in place to secure them and manage access, is not that difficult. I get the impression that a lot of exchanges are (or were in the early days) built by 'enthusiasts' who know just enough tech to be dangerous.
tradertef 6y ago
You are assuming cold storage can not be "hacked" or "stolen". It is much more difficult at Coinbase scale but such an event would have drastic impact on crypto markets. Coinbase is too big to fail :)
- tony101 6y ago
  I'm not assuming that. I said "it's not perfect" and simply listed the security measures that I am aware of :)

hakeberio 6y ago

Regarding your last line: futures trade nearly 24 hours, 6 days/week. It's also several times bigger than the ETF market, in terms of average daily dollar volume, so you get the liquidity and smaller spreads as well. [1] [1]: https://www.cmegroup.com/education/courses/futures-vs-etfs/why-trade-futures-instead-of-etfs.html https://www.cmegroup.com/education/courses/futures-vs-etfs/w...